The Industry And The Consumers Shopping Habits Essay

788 Words Apr 22nd, 2015 4 Pages
once most popular with the consumer are now under threat due to shaping of the industry and the consumers shopping habits. The market that is filled with imitators and followers, to ensure competitive advantage differentiation has become a major means (Grewal, 2007). In most recent years, Tesco has gone from expanding massively and being the UK’s biggest grocery retailer by revenue to receiving nonstop profit warnings and a questionable future. The ‘wheel of retailing’ theory, according to the wheel of retailing theory, retail innovators often first appear as low-price operators with low costs and low profit margin requirements. Over time, the innovators upgrade the products they carry and improve their facilities and customer service (by adding better-quality items, locating in the higher-rent sites, providing credit and delivery and so on) and prices rise. As innovators mature, they become vulnerable to the new discounters with lower costs, hence, the wheel of retailing. (Bhatia 2008). Tesco is one of many grocers that can be used as an example of the wheel of retailing. When Tesco first started as an East End market stall it made its name "piling them high and selling them cheap" to a generation of cash-strapped housewives and continued to compete with the classier retailer, Sainsbury’s. By 1977 the ‘wheel of retail’ began rolling, Tesco began a price war with Sainsbury’s and save £20m on a stamp saving scheme that had been part of the business for 15 years, this was…

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